BOE approves revenue sharing agreement
by David Atchison
Feb 27, 2013 | 1863 views |  0 comments | 6 6 recommendations | email to a friend | print
PELL CITY - School Board members approved a resolution Tuesday supporting an agreement with the city to share revenue generated from the 2010 sales tax hike.

The unanimous decision came at a special called meeting Tuesday after the board met Sunday afternoon for a work session to discuss details of the agreement.

The City Council has not formally approved the agreement. At the council’s Monday night meeting, the council tabled the matter.

Councilman Terry Templin, who made the motion to table the vote for the agreement, said not all members of the council were present, and it was best that the School Board approve the agreement first.

The council is expected to formally vote on the agreement at a special called council meeting slated for 10 a.m. Friday.

In accordance with the proposed agreement, the School Board would receive 30 percent of the revenue generated from the 2010 tax increase for the next six years or until 2020.

Officials said after Oct. 1, 2020, the city would provide the school system 50 percent of the revenue generated from the 2010 sales tax increase only if a school voting district is not formed and the people living in the school district do not vote in favor of additional funding for the school system.

The school system must work with the city to form a school tax district.

The original agreement provided half the revenue generated from the tax increase to the school system for four years, or until April 30, 2014. The new agreement extends the agreement between the two entities.

In accordance with the new agreement, the city will share in the cost of setting up a new school district.

“The City and the Board shall divide equally the costs of pursuing the establishment of an expanded and redefined Pell City school taxing district and any ad valorem for said expanded and redefined school district, including, but not limited to, all necessary legal fees, costs and expenses,” the proposed agreement states.

Bobby Hathcock, superintendent of Pell City schools, told his board that this was the first time anyone has offered to share in the expense of setting up a school taxing district.

The cost involved with setting up a district was of major concern for the School Board.

“How are we going to pay for redistricting?” School Board member Laurie Henderson asked.

Two weeks ago, the board had discussed refinancing a 2006 bond issue, which investment bankers said could give the School Board close to $900,000 in savings.

Jeff Jones said Sunday the school board could set aside the money or part of that money made from the refinancing of the 2006 bond issue to pay for the redistricting, although no one has put a price tag on the long, drawn out redistricting process.

He said the school board could pay for their share of the redistricting process and have money left over.

“That was my only concern,” Henderson said, adding that she believes the redistricting process is going to be very expensive. “We have a plan on how we’re going to pay for this (redistricting). I think Jeff’s idea is a good way to cover the funding.”

Jones said setting up a new school tax district is long overdue.

“I see this as a window of opportunity,” he told fellow board members. “I’m excited at the fact that we are both willing to get this done. There is no better investment the city can make than in the school system.”

Currently more than 50 percent of the students live outside the city limits, but attend Pell City schools. The city school board receives ad valorem taxes from the county based on the number of students it has, but only residents living inside the city limits can vote for city school board members, so it is basically taxation without representation for those people who have children attending Pell City schools, but who live outside the city limits.

Hathcock said it is a difficult process, not only setting up a school tax district, but also having the people vote in favor of a self-imposed tax.

“I’m going to say it’s going to be very, very difficult to get that accomplished,” he said.

Contact David Atchison at datchison@dailyhome.com